Small and medium-sized enterprises (SMEs) are the engine of the economy in Mexico, since they contribute 52% of the Gross Domestic Product (GDP) and generate 72% of employment in the country according to INEGI data. However, they often face financial and operational challenges that hinder their growth. What role could the open finance in this reality?
Some of the main challenges they face include the limited access to financethe lack of technological infrastructure and digitization, the administrative and regulatory burden, the unequal competition with large companies, the lack of access to international markets and the difficulty in attracting and retaining specialized talent. These challenges require innovative solutions and a favorable environment that promotes financial inclusion, government support, and collaboration between different actors in the business ecosystem to overcome obstacles and allow sustainable growth of SMEs in Mexico.
However, in recent years the rise of open finance it has opened up new opportunities for these companies, and has become an invaluable ally in this process.
Easier and faster access to financing
One of the biggest barriers to the growth of SMEs is the lack of access to financing. It is estimated that 11.4% of SMEs have obtained some type of financing. However, their biggest obstacle to growth is the difficulties they face when getting a bank loan. Traditionally, financial institutions have imposed strict requirements and slow processes to grant loans to SMEs.
Thanks to open finance, SMEs can now provide access to financial data in real time, allowing for a more accurate assessment of their credit and payment capacity.
A clear example of this is the information that can be obtained from tax data extracted directly from the SAT, with which identity can be verified almost immediately, as well as knowing the financial health of potential clients, by knowing their income. their real income, their tax situation and their opinions on tax compliance.
This has led to greater access to financing, with more agile processes and more competitive rates, which allows SMEs to invest in their growth and expansion. Companies like Jeeves and Tribal have opted to use the models of open finance to provide credit to this type of companies, achieving important results in this sector.
open finance: Transparency and informed decision-making
The lack of financial transparency has often been a challenge for SMEs. Without a clear view of your current financial situation, making informed decisions can be difficult. In order to solve this inconvenience, SMEs can benefit from ERP or enterprise resource planning systems, which are directly connected and fed by the open finance.
By allowing instant access to financial data through these systems, SMEs can gain a clear view of their cash flow, income and expenses. This enables them to make more informed decisions about investments, budgets, and growth strategies, which in turn increases their ability to compete and thrive in the marketplace.
Another key benefit of open finance is the automation of financial processes. SMBs often face an overwhelming administrative burden, spending valuable time and resources on repetitive and tedious tasks. However, with the open finance, SMEs can easily integrate their financial data with software solutions and tools that automate these processes. From payroll management to accounting and financial analysis, these models save SMEs time and resources, allowing them to focus on key activities and accelerate their growth.
innovation and collaboration
He open finance it also encourages innovation and collaboration between SMEs and fintechs. By securely sharing financial data with third parties, SMBs can access specialized services and customized solutions previously only available to large enterprises. This boosts the competitiveness of SMEs and allows them to offer innovative products and services to their customers. In addition, collaboration with fintech and other companies in the financial ecosystem creates an environment for mutual learning and growth, where SMEs can take advantage of the experience and knowledge of other players in the sector.
Finance solutions will play a fundamental role in the growth of SMEs in Mexico.
By facilitating access to finance, promoting transparency and informed decision-making, automating financial processes, and fostering innovation and collaboration, these solutions are paving the way for SMEs to reach their full potential.
As a country, we must continue to support and adopt these tools, giving SMEs the opportunities they deserve to prosper and contribute to the economic development of Mexico.
Pablo Viguera Pablo is the co-CEO and co-founder of Belvo and has a career as an entrepreneur linked to the internet world, now focused on fintech. He has been COO at Verse, one of the leading P2P payment applications in Europe, and General Manager (Spain) at Revolut, one of the fastest growing fintech startups worldwide.